Citybus sell-off a 'shambles'
THE proposed Citybus sell-off has been "a total disaster", says the boss of a rival bus company.
The bidding process set up by Plymouth City Council to find out how much the company is worth has been "a shambles" and could end up costing "many millions of pounds", Marc Reddy, managing director of First Devon and Cornwall, said yesterday.
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Marc Reddy MD of First buses
A council spokesman robustly defended the process, saying: "First clearly have a commercial interest in the outcome of this process and these comments need be read with that in mind."
The council is inviting offers for its 100 per cent shareholding in Citybus to test the company's true market value with a view to selling if the price is right.
Mr Reddy said the council had released so much commercially confidential information that it should abort the process and start again.
The council revealed last month that First had withdrawn from bidding.
At the same time Cllr Ian Bowyer, the city's Cabinet member for finance, told The Herald that a consortium led by Plymouth taxi boss John Preece was "no longer in the running".
And a report to the Cabinet revealed that the council had received several bids "well in excess of £10million".
"They need to sit back and say to themselves: If we're serious about selling, let's restart the whole process," Mr Reddy said.
"Or they could decide to keep the asset and let it pay a dividend every year. They don't have to sell. There's no shame in that.
"The whole process has left me gobsmacked. That they let John Preece know that his consortium wasn't shortlisted through The Herald.
"They've even mentioned prices. This is a process that should be totally confidential.
"The council has said it is prepared to spend just under £1million on this process.
"The price will run into many millions when you take into account legal fees and the way it is likely to drag out.
"This whole thing seems to be a total disaster.
"It could take until the middle of next year, and the longer it takes the bigger the bill."
First is in the middle of a programme of developing new services, but Mr Reddy denied that he was deliberately targeting Citybus to spoil the sell-off.
He said First had looked at the market and begun a programme of investment in April 2008.
Since then, the company had boosted passenger numbers by 7.3 per cent.
In the third phase of improvements First will add new services to Ernesettle, Southway, Mainstone, Estover and Plympton, starting on Monday.
For the first two weeks, there will be a £1 flat fee on those routes.
It has also been aggressively discounting existing fares, with an offer of a six-month season ticket for the price of three months available until the end of this week.
"I'm not trying to target Citybus in any way. It's just about trying to develop something new and attractive – and with simpler routes and timetables."
Mr Reddy also denied that he was speaking out in an attempt to influence the bidding in First's favour.
Asked whether he was afraid that a more powerful competitor would move into the city, he said: "I welcome competition. It's not something I'm afraid of."
He said he was surprised that the council wanted to sell Citybus. "If it's such a good asset, why are they selling it – particularly in a recession?"
The council spokesman said: "The exercise to find out the value of Citybus has been carried out in a fair and transparent way and expert advice and support has been used throughout.
"We have always been aware of the possibility of legal challenges which is why we have ensured we have followed a very robust process.
"We were aware of concerns about the possibility of a bus service monopoly being formed in Plymouth if the company were to be sold to First and we were able to allay those concerns by confirming that First were not proceeding with a bid.
"It has been public knowledge that a member of the council has not been able to take part in discussions about Citybus because a company in which he was a minority shareholder could have been involved in bidding for it. "He has now confirmed that he can take part in discussions as the company is no longer part of the process. The council has not commented about this company at any point.
"The council has always maintained that it expected to receive offers in excess of £10 million. All it has done is confirm that it has received offers in excess of this amount and nothing more. There is nothing improper in doing this."
PLYMOUTH City Council's proposed sale of its shares in Citybus will come under the spotlight at a community meeting tonight.
John Ackroyd , the managing director of Citybus, and Mark Baskerville, representative for the drivers' union Unite, have been invited to the Goosewell PACT (Partners and Communities Together) meeting.
Residents in Goosewell, Plymstock, have been left without a bus service after First withdrew its service.
Citybus has promised to provide a new service from the end of this month, but there are fears about the impact if the council sells its stake in the company.
The meeting starts at 7pm at the Radford Community Centre in Stokingway Close, Goosewell.
45 Comments
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by chaos, hells kitchen
Sunday, October 11 2009, 3:07AM
“oh my dear martin peverell i do so honestly feel sorry for you and your parents, did they realise they where raising a gullable short sighted puppet as you grew up, this council will make a short term gain and just like they always do will squander those gains on the fine wine and lunches at so called meetings at such places as the moorland links hotel or the elfordliegh or maybe at the duke of cornwall, just like the losses made with the icelandic banking chaos these council members where warned and took no heed so please dont mock the poor lad at exeter who made far more sense then your blinkered self but please feel inflated by your own ego and sense of self importance if it makes you feel better but please dont insist this sale makes sense unless its your pocket that grows fat on the deal, when all is done what is left will be but a shadow of its former self until nought is left but a few aged wagons more in keeping with the 50s.”
by Martin, Peverell
Friday, October 09 2009, 5:12PM
“Mark from Exeter,
What planet are you from? the very few members of the labour council probably.
I am no politician, but do you actually think anyone is going to believe you, I have read some rubbish on this site, but this story about to go national, your having a joke.
Remind me how many protestors turned up? no more than a hundred, most of then unionists and council members from the labour party.
I don't know whether Viv Pengelly is worried or not about her seat, but I and many others are glad that this idea is being looked at. If PCC can get £20 million and then invest this in our city, then this is a good idea.
Viv keep going there are many people who will still vote for you.
Marc Reddy has his own agenda and it's not for the benefit of the people of Plymouth.”
by Driver, Plymouth
Thursday, October 08 2009, 11:39PM
“Message to "Support the sale of citybus", i am always polite, smart and couteous! Maybe some of the passengers could take a leaf out of my book and less drivers would be grumpy. Buses run late generally because of the severe traffic jams around the city and the occasional break down. Even if another company ran citybus then these would still be a problem, if the new company could promise no late rinning because of the traffic or no break downs then i would start to wonder who they sold their soul to! I love my job but before people criticise they should spend a week trying to drive a bus through our city. How many times have you been sat in traffic at derriford, mutley or drakes circus? Please live in the real world!”
by Mark, Exeter
Thursday, October 08 2009, 9:11PM
“Oh Vivian, what have you done?
Of course the only winners in all this will be the army of consultants working in the background on the sale.
The losers will be the public transport users of both companies. Yes there will be cheap fares now and a few new services. But once this bus war is over costs will need to be recouped, and we all know who will be paying for it. Some people are already suffering with both FDC and PCB withdrawing some services to help pay for the main fight.
Conservative Councillors must also be worried, especially given the recent Ham election results which should have been an easy Conservative win, yet not only did Labour managed to hold this seat, but increased substantially its majority.
Vivian Pengelly and Wiggins are probably thinking about next years elections wondering how safe their seats are. Especially as there are strong signs that the Citybus story is about to go national. This will not please David Cameroon who has spent a lot of time preaching thrift. Only to now find that one of his Councils is spending a large slice of its reserves in a very questionable manor. It¿s bad enough that its making big cuts to front line services whilst still maintaining its army of consultants working on dream projects the City will never be able to afford.
Marc is right in that the way the Council is going about this sale is very bizarre. Sadly I feel it¿s too late for Citybus. Council Officers have sown the seeds that may have all but destroyed it.
Oh Vivian, what have you done?”
by MC, Plymouth
Thursday, October 08 2009, 7:48PM
“I am no management fan at all, but Marc Reddy is a pretty good MD and its a long time since we have had one of those, and he is a busman”
by King Arthur, Plymouth
Thursday, October 08 2009, 6:43PM
“Gobsmacked ~ what kind of language is that from an MD.
I used to work for First, Reddy would walk past you and ignore you. The buses would be tatty and break down. The general rule was, do your best for the passengers, take a mobile to phone when you broke down, a book and food.
If First get it then fares will go up and the service will get worse.
The Council have been idiots and First have taken advantage. The public will pay in the Poll tax and fares.”
by bus man, still waiting for a bus
Thursday, October 08 2009, 6:37PM
“yea sell citybus service is rubbish prices are to high. Hopefully a better bus company will take over, sometimes you could wait up to 25 minutes for a bus. The sunday service is a complete joke buses every hour .”
by tTERENCE, ROBOROUGH
Thursday, October 08 2009, 5:25PM
“FIRST BUS WANT TO SORT OUT THEIR SHAMBLES BEFORE THEY SHOUT ABOUT CITY BUS , AT ROBOROUGH WE HAVE TO DEPEND ON THE TAVISTOCK BUSES. MEANT TO BE 4 PER HOUR IN THE DAY , THEY RARELY RUN ON TIME IF ATALL,THOSE TH TURN UP ARE ON THEIR LAST LEGS .”
by David, Plymouth
Thursday, October 08 2009, 4:48PM
“Hey, PCB does make a small profit for PCC, the Pavilions and Theatre Royal, Mayflower Centre, Tinside does not...
Why not sell these loss making enterprizes off ? .. Sorry I forgot no private business would want to know !! so its down to the taxpayer to take these losses.”
by CoolEd, Plymouth
Thursday, October 08 2009, 2:56PM
“I agree with Marc Reddy about the sell off plans being a shambles.
I am not worried about competition between First and PCB, so long as the competition is on a like for like basis, improving the travel options and frequency of buses. The problem arises when First introduce a new service to different areas of Plymouth and conveniently do not offer a competing service during the evening too! Cream some of the passengers away from PCB but do not offer the same service level.
What about matching PCB's service level and improve the service for the benefit of the whole community. When passengers know there is an exceptional bus service they will be more inclined to use it. Passengers are less likely to travel when they have had poor experiences - delays etc. - not necessarily any fault of bus companies.
Work for better bus services for the local people.”